French General Tax Code
In forceI.-The value of the assets mentioned in article 965 is determined in accordance with the rules in force for death duties.
By way of derogation from the second paragraph of article 761, a 30% allowance is applied to the real market value of the property if it is occupied as the owner's main residence. In the case of joint taxation, only one property is eligible for the above allowance.
Securities listed on a market are valued at the last known price or the average of the last thirty prices preceding the date of taxation.
II.-For the valuation of the units or shares mentioned in 2° of article 965, debts contracted directly or indirectly, by a company or organisation are not taken into account:
1° For the acquisition of a taxable asset from a person mentioned in 1° of article 965 who controls, within the meaning of 2° of III of article 150-0 B ter, alone or jointly with the other persons mentioned in 1° of Article 965, the company or body mentioned in the first paragraph of this II;
2° From a person mentioned in 1° of Article 965, for the acquisition of a taxable asset or for expenditure mentioned in 2° and 3° of I of Article 974 relating to such an asset, in proportion to the stake held by that person in the company or organisation, alone or jointly with the other persons mentioned in 1° of article 965 ;
3° From a person mentioned in 2° of III of Article 974, for the acquisition of a taxable asset or for the expenses mentioned in 2° and 3° of I of the same Article 974 relating to such an asset, in proportion to the stake held by that person in the company or organisation, alone or jointly with the other persons mentioned in 1° of Article 965;
4° With a company or body controlled, within the meaning of 2° of III of article 150-0 B ter, directly or through one or more interposed companies or bodies, by one of the persons mentioned in 1° of article 965, alone or jointly with the other persons mentioned in the same 1°, their ascendants or descendants or their brothers and sisters, for the acquisition of a taxable asset or for the expenses mentioned in 2° and 3° of I of article 974 relating to such an asset, in proportion to the stake held by that person in the company or organisation, alone or jointly with the other persons mentioned in 1° of article 965.
1°, 2° and 4° of this II do not apply if the taxpayer can prove that the loan was not taken out primarily for tax purposes.
3° of this II does not apply if the taxpayer can justify the normal nature of the terms of the loan, in particular compliance with the term of the repayments, the amount and the actual nature of the repayments.
III.-For the valuation of the shares mentioned in 2° of article 965, the debts corresponding to the loans mentioned in II of article 974 contracted, directly or indirectly, by a company or organisation for the purchase of a taxable asset are taken into account each year up to the deductible amount defined in this same II.
